Tax Season 2017: Are You Capitalizing on Education Tax Credits and Deductions?

Sallie Mae Offers Tips for Students and Families Filing Taxes this

NEWARK, Del.–(BUSINESS WIRE)–Tax season is already in full swing, and Sallie Mae, the nation’s
saving, planning, and paying for college company, recommends students
and families investigate often-overlooked higher education tax credits
and deductions. Education tax credits and deductions are available to
help recoup the costs of college expenses, such as tuition, fees, or
interest accrued on student loans. The key is to understand what’s
available, determine eligibility, and take action to ensure no money is
left on the table.

In fact, according to the College
, the average family saved about $1,290 in education tax
credits and deductions in 2015-16. However, “How
America Pays for College
,” an annual study conducted by Sallie Mae
and Ipsos, reports that fewer than half of American families took
advantage of tax credits or deductions to make college affordable in

“A college education is a major investment, so when there are
opportunities to put money back in your pocket, it’s worth doing a
little homework,” said Martha Holler, senior vice president, Sallie Mae.
“Chances are, if you’ve covered tuition expenses or paid interest on a
student loan, you may be eligible for a credit or deduction. It’s just a
matter of getting smart about what’s available and determining if you

Sallie Mae’s easy-to-follow flowchart can help students and families
determine eligibility for tax credits and deductions. Here’s a look at
what’s available:

  • Student Loan Interest Deduction. Student loan borrowers may be
    eligible for up to $2,500 in student loan interest deductions to
    offset income subject to tax. Available for both federal and eligible
    private student loans in repayment, single filers with a modified
    adjusted gross income of less than $80,000 and those with a joint
    modified adjusted gross income less than $160,000 qualify for this
  • Tuition and Fees Deduction. Students and families can claim up
    to $4,000 in expenses for higher education to offset income subject to
    tax. This deduction is taken as an adjustment to income and an
    individual does not need to itemize other deductions. Individuals with
    a modified adjusted gross income of up to $80,000 and those with a
    joint modified adjusted gross income of up to $160,000 can file for
    this deduction. Families can claim only one credit for the same
    student in any one year, and cannot take both this deduction and a
    credit in the same year.
  • The American Opportunity Credit. Eligible taxpayers may qualify
    for a maximum annual credit of $2,500 per student for the first four
    years of higher education. To be eligible, a student must be enrolled
    at least half-time in a degree or other recognized educational
    credential. The credit can be applied to course-related books and
    supplies in addition to tuition and fees. A single taxpayer can have a
    2016 income of up to $80,000 to receive the full credit, or a partial
    credit is available for an income amounting to $90,000. Married filers
    with an adjusted gross income up to $160,000 are eligible for the full
    credit and up to $180,000 for a partial credit.
  • The Lifetime Learning Credit. Eligible taxpayers may qualify
    for up to $2,000 per tax return to help pay for undergraduate,
    graduate, and professional degree courses – including courses designed
    to improve job skills. There is no limit on the number of years an
    individual can claim the Lifetime Learning Credit. The Lifetime
    Learning Credit is available to taxpayers with modified adjusted gross
    income of less than $65,000, or $131,000 if filing jointly. The credit
    is reduced gradually for single filers making more than $55,000, and
    for joint filers making more than $111,000.

Additional information on education tax credits and deductions is
available through the Internal Revenue Service Publication 970, Tax
Benefits for Education, or through a personal tax advisor1.

When it comes to paying for college, Sallie Mae recommends families
follow its 1-2-3 approach: first, maximize money that does not need to
be repaid, such as scholarships and grants; second, explore federal
student loans; and, third, consider a responsible private education loan.

Join the conversation on how to save, plan and pay responsibly for
college at


  This information is not meant to provide tax advice. Whether filing
jointly or separately, consult with a tax advisor for education tax
credit and deduction eligibility.

Sallie Mae (Nasdaq: SLM) is the nation’s saving, planning, and
paying for college company. Whether college is a long way off or just
around the corner, Sallie Mae offers products that promote responsible
personal finance including private education loans, Upromise rewards,
scholarship search, college financial planning tools, and online retail
banking. Learn more at
Commonly known as Sallie Mae, SLM Corporation and its subsidiaries are
not sponsored by or agencies of the United States of America.


Sallie Mae
Beth K. Toll, 302-463-0109